China's economy will be larger than America's in 20 years, but India's will be growing faster, says a new US intelligence report issued on Monday.
“India’s rate of economic growth is likely to rise while China’s slows,” Reuters quoted the report, issued by the US government's National Intelligence Council, as saying. “In 2030 India could be the rising economic powerhouse that China is seen to be today. China’s current economic growth rate – 8 to 10 percent – will probably be a distant memory by 2030.”
Asia as a whole will also overtake North America and Europe combined in global power by 2030, the report said, while the economies of Europe, Japan and Russia are likely to continue their “slow relative declines.”
Despite the economic power of China, the authors expect the US to retain its superpower status because it still is the only country able to pull together coalitions and mobilize efforts to deal with global challenges, according to Reuters.
“China isn’t going to replace the US on a global level,” Mathew Burrows, counselor to the National Intelligence Council, said at a media briefing. “Being the largest economic power is important … [but] it isn’t necessarily the largest economic power that always is going to be the superpower.”
Take both predictions with a grain of salt, or a handful, if you believe Morgan Stanley's Ruchir Sharma, the author of “Breakout Nations.”
As Sharma writes in Monday's Economic Times:
History shows that only a third of all emerging nations are likely to grow fast in any decade, and are even less likely to continue growing for a second or third decade. The longer a boom lasts, the less likely it is to continue. The result is that, over time, emerging markets are not 'catching up' with the rich, as many think. Their average incomes are the same relative to rich-nation incomes in 1950. India's strong growth in the 2000s reduced the likelihood of a second good decade, and it is slowing.